Millennials are turning their backs on the stock market, and this will gradually transform the financial landscape, says a new in-depth study by Wall Street titan Goldman Sachs.
Since the financial crisis, millennials have seen their parents suffer great monetary losses as they had invested a lot of their money in stock markets. This made a lot of young people apprehensive about dipping their toes into the pool of finance. Now Wall Street may pay dearly and may be forced to adapt to changes if millennials continue to refrain from entering markets.
Goldman Sachs released the results of a new survey that found only 18% of millennials trusting the stock market "as the best way to save for the future." Meanwhile, about one-fifth of millennial respondents conceded to not having enough knowledge. Another 16% described stocks as being too volatile and unfair for small-time investors.
Millennials - those born between the years 1980 and 2000 - are now starting to ramp up their savings. Wall Street is beginning to take notice, particularly as Baby Boomers are pulling their money out of the markets.
The Generation’s Stance on Fees & Debt
Ostensibly, millennials would try their hardest to avoid banking fees at all times. When asked for their opinion on banking fees, 43% said they try to avoid it at all costs. A majority of survey-takers noted they’d be content with fees as long as it led to good, or improved, service.
They were also asked what would make them change their bank: more than half (55%) cited high fees. 42% cited bad customer service, 30% alluded to less interest and one-quarter admitted they wouldn’t change at all unless there was a huge problem.
Millennials Don’t Want Any Stinkin’ Advice
Although most millennials seek financial advice from their parents, a considerable amount of people are rather indifferent about financial guidance. The survey found that nearly half (43%) of participants wouldn’t spend more than an hour on receiving investment advice. Another 13% wouldn’t search for any financial suggestions at all.
For a generation that lacks financial aptitude, this is rather dangerous and could prove financially fatal in the years coming when price inflation soars and wages remain stagnant.
Surprisingly, Millennials Refuse to Use Bitcoin
Acknowledging that millennials embrace any form of technology - though their acumen is rather limited - we would assume that they’d love the peer-to-peer decentralized digital currency bitcoin. But we are sadly mistaken.
The financial institution discovered that more than half (51%) admitted to never having used bitcoin, while they also do not have any plans to start utilizing the virtual currency. Nearly one-quarter (22%) are presently using it or have actually used it in the past and plan to do so again.
Another 22% reported to never having employed bitcoin in their financial habits, however they have plans to use the cryptocurrency. A minuscule five per cent of participants answered that they have used bitcoin but have no intention to do so again.
Millennials’ Indifference Towards Financial Privacy
Despite our calls for Internet and financial privacy, it seems we’re willing to sacrifice it for convenience. This is noticeable every single day, whether it’s our Facebook usage or monetary transactions. We dislike it but we’re willing to accept it. The report confirmed this, a large number of respondents were apathetic regarding financial privacy.
When asked if they would be willing to "accept inconveniences" in exchange for a reduction in privacy and enhanced security, one-third of male respondents and 48% of female respondents replied with "not too bothered" as long as their service wasn’t too affected.
Twenty-two per cent admitted they’re in favor of sacrificing privacy for security, while one-fifth averred they’re not willing to concede financial privacy. 13% responded that they’re content with reduced privacy if it means better security. 11% said they’re indifferent because they already know the government is tracking their transactions and financial activities.
See Also: How to Talk to Millennials About Money
The banking industry has been warned repeatedly in the past couple of years that they need to change the way they do business. Since millennials are trying to coalesce better financial behaviors, enhanced technological convenience and improved social consciousness, financial institutions have to accommodate this trend. If they don’t modify their actions then it could lead to less revenues and profits; perhaps even extinction. Millennials are no longer the future but the present. They are now the dominant force in both the workforce and the consuming economy. Note to banks: adapt or perish.